ORIENTAL AROMATICS 2021-22 Annual Report Analysis

Wed, 6 Jul

ORIENTAL AROMATICS has announced its results for the year ended March 2022. Let us have a look at the detailed performance review of the company during FY21-22.

ORIENTAL AROMATICS Income Statement Analysis

• Operating income during the year rose 22.6% on a year-on-year (YoY) basis.
• The company's operating profit decreased by 40.3% YoY during the fiscal. Operating profit margins witnessed a fall and stood at 10.7% in FY22 as against 21.9% in FY21.
• Depreciation charges decreased by 2.6% and finance costs increased by 75.0% YoY, respectively.
• Other income grew by 166.6% YoY.
• Net profit for the year declined by 47.7% YoY.
• Net profit margins during the year declined from 14.4% in FY21 to 6.1% in FY22.

ORIENTAL AROMATICS Income Statement 2021-22

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Net Sales	Rs m	7,088	8,688	22.6%
Other income	Rs m	17	44	166.6%
Total Revenues	Rs m	7,105	8,732	22.9%
Gross profit	Rs m	1,551	925	-40.3%
Depreciation	Rs m	175	170	-2.6%
Interest	Rs m	23	40	75.0%
Profit before tax	Rs m	1,370	759	-44.6%
Tax	Rs m	350	226	-35.5%
Profit after tax	Rs m	1,019	533	-47.7%
Gross profit margin	%	21.9	10.7
Effective tax rate	%	25.6	29.8
Net profit margin	%	14.4	6.1

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ORIENTAL AROMATICS Balance Sheet Analysis

• The company's current liabilities during FY22 stood at Rs 2 billion as compared to Rs 2 billion in FY21, thereby witnessing an increase of 17.1%.
• Long-term debt stood at Rs 450 million as compared to Rs 0 million during FY21, a fall of 0.0%.
• Current assets rose 16% and stood at Rs 6 billion, while fixed assets rose 16% and stood at Rs 3 billion in FY22.
• Overall, the total assets and liabilities for FY22 stood at Rs 9 billion as against Rs 7 billion during FY21, thereby witnessing a growth of 16%.

ORIENTAL AROMATICS Balance Sheet as on March 2022

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*	% Change
Networth	Rs m	5,573	6,052	8.6
Current Liabilities	Rs m	1,584	1,855	17.1
Long-term Debt	Rs m	0	450	0.0
Total Liabilities	Rs m	7,450	8,649	16.1
Current assets	Rs m	4,775	5,551	16.3
Fixed Assets	Rs m	2,675	3,098	15.8
Total Assets	Rs m	7,450	8,649	16.1

ORIENTAL AROMATICS Cash Flow Statement Analysis

• ORIENTAL AROMATICS's cash flow from operating activities (CFO) during FY22 stood at Rs -8 million on a YoY basis.
• Cash flow from investing activities (CFI) during FY22 stood at Rs -594 million, an improvement of 70.1% on a YoY basis.
• Cash flow from financial activities (CFF) during FY22 stood at Rs 515 million, an improvement of 228% on a YoY basis.
• Overall, net cash flows for the company during FY22 stood at Rs -88 million from the Rs -19 million net cash flows seen during FY21.

ORIENTAL AROMATICS Cash Flow Statement 2021-22

Particulars	No. of months	12	12	% Change
	Year Ending	Mar-21	Mar-22
Cash Flow from Operating Activities	Rs m	173	-8	-
Cash Flow from Investing Activities	Rs m	-349	-594	-
Cash Flow from Financing Activities	Rs m	157	515	228.1%
Net Cash Flow	Rs m	-19	-88	-

Current Valuations for ORIENTAL AROMATICS

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 15.8, an decline from the EPS of Rs 30.3 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 555.0, stands at 35.0 times its trailing twelve months earnings.
• The price to book value (P/BV) ratio at current price levels stands at 3.1 times, while the price to sales ratio stands at 2.1 times.
• The company's price to cash flow (P/CF) ratio stood at 41.0 times its end-of-year operating cash flow earnings.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Sales per share (Unadj.)	Rs	210.6	258.2
TTM Earnings per share	Rs	30.3	15.8
Diluted earnings per share	Rs	30.3	15.8
Price to Cash Flow	x	16.5	41.0
TTM P/E ratio	x	19.4	35.0
Price / Book Value ratio	x	2.5	4.8
Market Cap	Rs m	13,766	28,826
Dividends per share (Unadj.)	Rs	2.5	1.5

Ratio Analysis for ORIENTAL AROMATICS

• Solvency Ratios

Current Ratio: The company's current ratio deteriorated and stood at 3.0x during FY22, from 3.0x during FY21. The current ratio measures the company's ability to pay short-term and long-term obligations.

Interest Coverage Ratio: The company's interest coverage ratio deteriorated and stood at 19.8x during FY22, from 60.3x during FY21. The interest coverage ratio of a company states how easily a company can pay its interest expense on outstanding debt. A higher ratio is preferable.

• Profitability Ratios

Return on Equity (ROE): The ROE for the company declined and down at 8.8% during FY22, from 18.3% during FY22. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

Return on Capital Employed (ROCE): The ROCE for the company declined and down at 12.3% during FY22, from 25.0% during FY21. The ROCE measures the ability of a firm to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

Return on Assets (ROA): The ROA of the company declined and down at 6.6% during FY22, from 14.0% during FY21. The ROA measures how efficiently the company uses its assets to generate earnings.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-21*	12 Mar-22*
Current ratio	x	3.0	3.0
Debtors’ Days	Days	971	818
Interest coverage	x	60.3	19.8
Debt to equity ratio	x	0.0	0.1
Return on assets	%	14.0	6.6
Return on equity	%	18.3	8.8
Return on capital employed	%	25.0	12.3

To see how ORIENTAL AROMATICS has performed over the last 5 years, please visit here.

ORIENTAL AROMATICS Share Price Performance

Over the last one year, ORIENTAL AROMATICS share price has moved down from Rs 864.5 to Rs 555.0, registering a loss of Rs 309.5 or around 35.8%.

Overall, the S&P BSE SENSEX is up 1.6% over the year.

(To know more, check out historical annual results for ORIENTAL AROMATICS and quarterly results for ORIENTAL AROMATICS)

Read: Latest Annual Report Analysis of ORIENTAL AROMATICS